NASDAQ index faces significant downturn amid rising U.S. yields

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The NASDAQ index, a major U.S. stock market index, has continued its downward trajectory this Thursday, following a substantial drop of 209 points on Wednesday and an additional decline of 120 points in early trading today. This downturn has made the NASDAQ the most impacted among its peers.

This slump coincides with an upward trend in U.S. yields. The 10-year yield witnessed a rise of 12.7 basis points, while the 2-year yield also increased by 4.1 basis points.

The Federal Reserve's recent decision to maintain its rates unchanged has also played a role in these market trends. However, the Fed has projected another rate hike within this year and has increased its forecast for the Fed funds rate at the end of 2024 to 5.1%, up from the previous expectation of 4.6%. Analysts have termed this scenario as "higher for longer."

Market figures shortly after opening today showed a decrease across major indices. The Dow Industrial Average stood at 34240.06, down by 200.83 points or a decrease of 0.58%. The S&P was at 4367.13, marking a decrease of 35.08 points or a drop of 0.80%. The NASDAQ index was at 13327.95, down by 141.18 points or a decrease of 1.05%.

In addition, the yield curve demonstrated an increase across different maturities. The 2-year yield rose to 5.156%, up by 3.7 basis points; the 5-year yield climbed to 4.617%, up by 10.4 basis points; the 10-year yield increased to 4.469%, up by 12.2 basis points; and the 30-year yield grew to 4.532%, up by 13.2 basis points.

These recent trends provide insight into the current state of different markets, indicating a challenging landscape for investors amid rising yields and the prospect of higher interest rates in the near future.

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